Mobile Operator
– Development in the US
— Sprint and WiMAX
— LTE Introduction
— Sprint/T-Mobile Merger
– China
– India
— Reliance Communication and JIO
– Germany
Infrastructe Provider
– Alcatel Lucent and Nokia
– Ericsson
– Starent and Cisco
Device Manufacturer
– Nokia
– The Smartphone Market
– Huawei
Semiconductors
– ST-Ericsson
– Intel
– Qualcomm
– Mediatek
– Hisilicon
– Spreadtrum/UniSoc

4G Industry Player

Mobile Operator

The introduction of smartphones was accompanied by a change in the way services were billed. Previously, telephone calls were billed individually. Data services were paid per megabyte. Fixed mobile phone contracts with terms of usually 2 years continued to dominate. Already in the noughties, more and more prepaid contracts appeared. These were not tied to fixed monthly amounts, but billing was based exclusively on actual consumption. If the credit was used up, you could no longer make calls. This was a good model, especially for young people, because it guaranteed cost control.

From 2010 onwards, data traffic no longer began to be charged based on consumption, but instead fixed monthly high-speed data packages were offered. In these contracts you could use around 1 GB of data per month. Once this data package was used up, only GPRS speed could be used. Such data packages were soon also available for prepaid tariffs. In the past, a contract was advertised with free minutes and free SMS, but now it was advertised with particularly fast transfers and large data packages.

Developments in the US

Sprint and WiMAX

In 2005, Intel announced that it had an agreement with Sprint to test WiMAX. Sprint had just merged with operator Nextel and was one of the major wireless carriers in the United States. Intel had already developed a WiMAX chip that would become part of the Intel PC chipset. In 2006, Intel invested $600 million in Clearwire to use WiMAX for wireless broadband. In the same year, Sprint announced that it would invest $3 billion in the new WiMAX network. The plan was to win 100 million users in 2008. Meanwhile, WiMAX was accepted as the official IMT2000 standard in 2007. The standard therefore had a certain claim to the corresponding IMTS 2000 bands. WiMAX had the ambition to become a new standard for wireless broadband in the USA and even worldwide.

Intel tried with brute force and large investments to make WiMAX the global standard for mobile broadband.

In 2008 there was a joint venture between Clearwire and Sprint/Nextel regarding WiMAX. At the same time, Mobile WiMAX went live in Baltimore. Sprint planed WiMAX in Atlanta, Charlotte, Chicago, Dallas, Fort Worth, Honolulu, Las Vegas, Philadelphia, Portland and Seattle. Boston, Houston, New York, San Francisco and Washington are scheduled to follow in 2010.

Introduction of LTE

Verizon Wireless still had a CDMA based network. This reached its limits at the end of the noughties. While 3GPP based networks achieved quite high data rates with HSDPA, this was not as possible with 1XRTT. An evolution of Qualcomm CDMA was not planned any further. Probably Intel had hopes that Verizon could switch to WiMAX now but Verizon decided to introduce LTE as early as possible. This happened back in 2010. This in turn increased the pressure on the competition to provide similar performance, even if they had HSDPA installed. Therefore, AT&T followed just a year later. Eventually, Sprint saw that they had to move along with LTE. They stopped their WiMAX strategy and replaced their previous WiMAX services with LTE services by 2016.

WiMAX therefore failed as a standard and discontinued its services over the years.

Sprint/T-Mobile Merger

AT&T tried to take over T-Mobile in 2010, which had already captured 10% of the market. However, this takeover was not approved by the authorities. In 2013, Sprint attempted a merger with T-Mobile. This was driven by Softbank (Japan), which had since taken over Sprint. However, this attempt was aborted. It seemed unlikely that the authorities would allow only three mobile operators to remain in the market. Nevertheless, the merger talks did not come to an end, this time driven by T-Mobile itself. However, it took until 2020 before the merger was actually approved. Since then, there are actually only three operators left in the United States. Verizon, AT&T and T-Mobile US.

China

In China, 3G was only deployed by the three operators in 2008. Three different 3G standards were used. However, in 2011, China Mobile began its first trials of TD-LTE. As of 2013, China Mobile exclusively used TD-LTE in band 40 (2.3 GHz). China Unicom and China Telecom also followed in 2015 with TD-LTE and a year later with FDD-LTE in band 3 at 1800 MHz.

India

Next to China, India was now the largest mobile communications market in the world. Until 2015, the mobile market in India was very fragmented. The big players were Barti Airtel which covered almost a quarter of the market, followed by Vodafone, Idea, Reliance Communication, BSNL, Tata, Aircel. It was only from 2010 that these operators migrated to 3G and from 2015 to 4G LTE.

Reliance Communication and JIO

Reliance Communication operated a Qualcomm based CDMA network and migrated to GSM and LTE from 2015. This company was founded in 2004 by Anil Ambani. This was the son of Dhirajlal Hirachand Ambani, the founder of Reliance Industries, the largest industrial conglomerate in India. Anil and his brother Mukesh took over Reliance. This made Anil one of the richest people in the world. Part of the Reliance empire that was awarded to Anil was the telecommunications sector. Anil therefore founded the mobile communications division, which became firmly established in India.

Anil’s brother Mukesh received the petroleum industry from Reliance. Today the largest oil refinery in the world. But Mukesh was also interested in telecommunications and thus competed with his brother. In February 2007, he founded Infotel Broadband Services Limited (IBSL). When the LTE licenses were awarded in 2010, IBSL managed to acquire an LTE license in all 22 districts of India. In 2013, the company was renamed Reliance JIO. Later the company was mainly called JIO. The name is a “mirror” of the word OIL, Reliance’s main business.

In 2015, JIO installed a pure 4G LTE network. It was the first time that a network without 3G/2G fall back was created. Actually, JIO could only have offered data services, but the Indian state allowed JIO to offer voice services over LTE using the relatively new Voice over LTE standard. Thus, JIO started its services in 2016. In order to get subscriber quickly, data access and voice services were free for the first six months. There has never been such a rush and growth in a new network. Within a year, JIO had 130 million mobile subscriptions. After the free period ended, JIO advertised competitive prices. Instead of 1 GB per month, it offered 1 GB per day. The price for 1 GB of data in India fell from 5 euros to 14 cents within a very short time.

Within four years, JIO became the largest provider in India. JIO made it possible for the majority of Indians to have broadband internet. Here in particular, JIO has more than half of the market and, in addition to access, also offers its own services that compete with the major global market leaders. Some of the popular Jio apps that customers can now find are:

Jio Pages – A web browser for Android phones launched by Jio
Jio Chat – JioChat is an instant messaging and video calling app for Jio users.
Jio Cinema – An online HD video library from Jio that provides users with movies, TV shows and music videos online
Jio Cloud – A secure cloud storage service from Jio
Jio Health – A healthcare service app from Jio
JioNews – A news app or e-reader for news from Jio
JioMeet – A video conferencing platform from Jio
JioMoney – A mobile wallet for Jio customers
JioSaavn – Offers online and offline music streaming in English and Indian languages
JioSecurity – A mobile security and antivirus app
JioTV – A streaming service from Jio
JioCall (Jio4GVoice) – A video calling feature for customers with landline numbers
MyJio – A Jio Account that allows the Jio users to manage their Jio account and digital services

Competition from JIO led to Vodafone and Idea joining forces. Barti Airtel was able to hold its own to some extent. Smaller providers gave up or went bankrupt. This also included Mukesh’s brother, Anil. Reliance Communication ran into trouble. They attempted to obtain exemption by handing over operation of the network to Ericsson. But they couldn’t pay Ericsson and in 2018 Reliance went bankrupt. Anil Ambani was personally liable for Reliance’s debts and faced prison for fraud. Shortly before an ultimatum expired, his brother Mukesh settled the debt. Anil, once one of the richest people in the world, was bankrupt. His company was dissolved. His brother Mukesh was now the richest person in Asia and continued to grow JIO.

Germany

All four German providers acquired LTE licenses or frequencies. This time the state received only four billion euros from issuing the licenses. E-Plus acquires the smallest share. From the end of 2010, Vodafone was the first to offer LTE via a Surfstick. Little by little, the other providers are following suit. Full coverage was achieved in 2015.

E-Plus was acquired by Telefónica in 2014. Since then there have only been three competitors on the German market.

Infrastructure Provider

Alcatel Lucent and Nokia

Alcatel Lucent continued to make heavy losses. Despite acquisitions (e.g. from Nortel), the company was unable to break even. Restructuring and layoffs were necessary again and again. Between 2007 and 2010 alone, losses totaled 9.5 billion euros. The company recovered in the meantime, but was then dragged down again by the financial crisis

In 2015, Nokia finally took over Alcatel-Lucent for almost 16 billion euros. The strategy was that the merger would lead to a strong market position that allows to withstand competition from Huawei. Nokia had thus united all western telecommunications companies (except Cisco and Ericsson). And Nokia got Bell Laboratories.

Ericsson

Ericsson has always been able to stay in the mobile phone business after divesting its handset business. However, Ericsson always had to adapt and always cut costs in crisis situations, for example by reducing the number of employees. But they managed to continue to establish themselves globally and also become a preferred supplier in India. Ericsson was even able to continue delivering in China. One new business model of Ericsson was (as described above) was not just to provide equipment but also to operate it on behalf of the operators.

Starent and Cisco

With LTE, mobile communications came close to becoming an Internet-dominated industry. Here, for example, Cisco was the top manufacturer as the main manufacturer of routers. SW companies were also very active here. A company that specialized in gateways, i.e. interfaces between mobile networks and the Internet, was Starent Networks, a classic start-up company. They developed the Serving Gateway and the Packet Data Gateway early on. In 2008 they managed to win Vodafone as a customer and installed the gateways in the networks. This made them a very valuable company. Back in 2009, they were acquired by Cisco for almost $3 billion. As a result, Cisco increasingly became an infrastructure manufacturer for mobile communications, at least as far as Internet gateways were concerned.

Device Manufacturer

Nokia

When LTE was introduced in 2010, Nokia was already in a precarious situation. Apple’s iPhone and Samsung’s Galaxy series began to dominate the market and iOS and Android were the successful operating systems. Nokia stuck with Symbian for too long, but it was completely unsuitable for multi-touch applications. However, they were too proud to switch to Android and instead developed a new operating system called MeeGo, which also performed quite well and was used from 2011 onwards.

In parallel, Nokia started a partnership with Microsoft. Microsoft had just released a new version of their Windows Mobile operating system. In 2012, Nokia launched the first Lumia phones with Windows. This meant that no one wanted to buy another Nokia smartphone (based on MeeGo) because they were already outdated. Sales in the smartphone sector practically imploded. At the same time, customers were critical of the Windows operating system. Nobody wanted a dependency on Microsoft, as was the case with PCs. As a result, sales of Nokia’s smartphones fell dramatically.

Since the market for simple telephones and feature phones also collapsed, Nokia ran into existential difficulties and made huge losses. Eventually they gave up the device business entirely by selling it to Microsoft. The incredible had happened. During the time Apple launched its iPhone, Nokia was the undisputed leader in mobile phones with almost 40% market share. Just 7 years later, Nokia disappeared from the market.

The Smartphone Market

The smartphone market was highly innovative and initially had many competitors. It was driven by Samsung and especially Apple. Apple always came up with an innovation in its annual conferences. Since Steve Jobs died in 2011, these have been carried out by Tim Cook. All other manufacturers had to follow suit. Every year the display technology and especially the cameras improved. In addition, new performance features were constantly being added.

In the beginning, manufacturers like the Taiwanese HTC were still among the innovative manufacturers. However, around 2013, HTC was barely able to keep up and fell behind, creating losses. HTC soon no longer played a significant role. The Korean company LG, which was actually one of the pioneers of multi-touch devices (LG Prada) and was initially able to keep up well with Apple, had a similar experience. It also ranked third in 2010 behind Apple and Samsung. But then LG started to create deficits and lost market share. In 2021, LG was actually barely in the market and gave up the mobile phone business. In recent years, LG has made a loss of $4.5 billion.

As of 2016, Apple, Samsung and the Chinese Manufacturer dominate the market with more than 60%.

Apple and Samsung have remained at the top of the mobile phone manufacturers over the years until today. Apple achieved this primarily through its focus on practically only one product line in the top market segment, where it was able to generate the highest margin in the business. For this reason Apple became the world’s most valuable company in the world.

Samsung had a slightly larger portfolio and was sometimes even ahead of Apple in terms of innovation. The Galaxy series in particular was the market leader worldwide. Samsung has been number one since they took over the leadership from Nokia in 2011. Only in 2020, Samsung was briefly pushed out of the top spot by Huawei.

HUAWEI

Huawei was the big winner among smartphones. This Chinese manufacturer was already successful in the infrastructure business. In 2004 they came onto the market with their first mobile phone. A year later with the first 3G model. Together with Samsung, LG and HTC, they jumped on the smartphone bandwagon early on and have continued to increase their market share over the years. In 2020, Samsung even managed to reach the top of the market with a market share of 20%.

However, Huawei came under suspicion of espionage in the USA. President Donald Trump even declared a national emergency because he saw the country’s security at risk. He embargoed Huawei in 2019. Initially, no Huawei infrastructure was allowed to be used. Then there was an export embargo. From now on, Google and Qualcomm were no longer allowed to supply Huawei. Within a year, Huawei’s sales collapsed and in 2021, Huawei was not even in the top 5 in the world.

In addition to Huawei, three other Chinese companies also entered the mobile phone market. On the one hand, Xiaumi and two brands from the large electronics group BBK Electronics called Oppo and Vivo.

Semiconductors

ST-Ericsson

ST Micro was a strong supplier in building the 2G and 3G chips. It was the number one supplier of RF chips, for example to Nokia and therefore a competitor to NXP. ST Micro and NXP merged and strengthened their RF position. With the merger with Ericsson, a lot of know-how in baseband modems was added. However, ST-Ericsson suffered from the decline of Nokia and they had to focus on the new market of smartphones. ST Micro had already developed a processor series (SoC) called Nomadic. It was ST’s answer to Texas Instruments‘ OMAP platform. Ericsson, in turn, had a baseband solution for 2G and 3G called Thor. This resulted in the NovaThor platform with ST-Ericsson. This also seemed to be successful. In 2011, Nokia announced that they would be separating from Qualcomm and incorporating NovaThor into their latest smartphone.

Unfortunately, Nokia smartphones were no longer very successful in 2012. As a result, ST-Ericsson made huge losses. Hope arose once again when a design-win made it into one of Samsung’s Galaxy phones. However, this was not enough. ST-Microelectronics pulled the plug and exited the joint venture. Ericsson now had the full burden and did not want to take over ST’s shares. In 2013, they went out of business and sold what was left to Intel for $90 million.

Intel

Intel took over Infineon’s mobile communications business in 2010. At that time, Infineon was still Apple’s main supplier. However, Apple also began building CDMA-based phones in 2010. Intel didn’t have modems for this and so it lost its customer Apple. Another reason was that Intel wasn’t quite ready to deliver LTE yet. Without Apple as a customer, Intel was not profitable, but continued to work intensively on the further development of the modems.

What Intel was still missing was a CDMAOne and CDMA2000 modem design. They got this through the acquisition of Via Telecom, a Taiwanese company that had once bought the CDMA modem from LSI Logic.

Apple achieved a new design win with the iPhone 7 in 2016. Nevertheless, the mobile phone business continued to be loss-making. Finally, there were intensive discussions between Intel and Apple starting in 2018. Apple eventually acquired Intel’s mobile phone business for $1 billion. Since then, Apple has had a large semiconductor development group in Munich. However, Intel left the mobile phone business for good. After the takeover, Apple had an 11% share of the semiconductor mobile phone market.

Qualcomm

Qualcomm remained firmly in the mobile phone business and was able to expand it further. What was particularly helpful here was its SnapDragon product range, which they sold in almost all smartphones. From 2010, Qualcomm also managed to win Apple as a customer. Still, Qualcomm and Apple were not good partners. Early on, Apple was dissatisfied with the high patent fees they had to pay Qualcomm. This improved somewhat with the installation of Qualcomm modems in Apple phones. Nevertheless, Apple tried to break away from Qualcomm. When they installed Intel chips, Qualcomm sued Apple for patent infringement. There was a threat of a sales stop for Apple phones in Germany, for example. It wasn’t until 2019 that Qualcomm reached an agreement with Apple about the license costs. Qualcomm had a market share of 30% in 2020.

Mediatek

Mediatek had already achieved a dominant position in the market for basic phones and feature phones. This was especially true for system solutions that enable phone manufacturers to build phones quickly and easily. Mediatek also succeeded in this business model in the smartphone sector. Since 2014, Mediatek has been offering the Helio platform, which offers LTE functionality in addition to 2G and 3G. The target market for this platform is the Asian and Indian markets. Xiaomi Helia, for example, uses this chipsets. Through its low-cost approach, Mediatek was able to reach the market share of the leader Qualcomm in 2020.

Hisilicon

HiSilicon is a subsidiary of Huawei, which primarily supplies system on chips for the mobile communications sector. The product range for smartphones was called Kirin and its performance kept up well with the competition. Because it primarily supplied Huawei, HiSilicon had a market share of 12% by 2020, on par with Samsung and Intel/Apple. However, HiSilicon was hit by American sanctions starting in 2020. First of all, there was a decline in Huawei phones. Then the manufacturers of IC design tools were no longer allowed to supply HiSilicon, which made design work almost impossible. In 2022, HiSilicon only had a market share of 1 %.

Spreadtrum/Unisoc

The Chinese manufacturer Spreadtrum renamed itself UniSoc. UniSoc was focused on smartphone chips for low cost and medium cost. So they competed with Mediatek. UniSoc made many successful gains in smaller, inexpensive smartphone models from Samsung. In 2020 they had a market share of 4%. They benefited from HiSilicon’s demise. They achieved a respectable 11% share but only a sales share of 3%.